Green Power for Mobile:

Top Ten Findings

The GSMA Development Fund

Green Power for Mobile: Top Ten Findings

The GSMA Development Fund has initiated the Green Power for Mobile programme to catalyse the deployment of green power solutions
across mobile networks. Green Power for Mobile consists of a diverse set of assets made available to mobile operators considering
alternatives to conventional sources of power for base station sites. The programme has recently concluded market research through indepth desk research and interviews with operators, green power vendors, green power systems integrators and telecommunications
equipment vendors.
The results of this assessment consist of analysis of various market dynamics and projected market potential for green power solutions.
The following are the top 10 central themes identified. Note that these themes are not in order of importance.

Off-grid locations are increasingly prevalent for mobile network sites

An estimated 75,000 new off-grid sites will be built each year in developing countries through 2012.
Annual Growth in BTS in Developing Regions 2007-2012
Middle East and North Africa
Latin America and Caribbean

Off-grid

Europe and Central Asia

On-grid

Sub-Saharran Africa
East Asia and Pacific
South Asia

Total
0

50000

100000

150000

200000

250000

300000

Source: GSMA Analysis

Connectivity to the grid presents four challenges:

Grid connectivity is unavailable in many locations. The portion of the population targeted by current mobile
network expansion is increasingly off-grid.

Where grid power can be attained, the costs of extending the grid to power off-grid base stations can be
enormous. The cost is based primarily on the distance of new infrastructure required. In some cases the operator
is required to finance standard grid equipment (such as transformers), which remain the property of the
utility. The following are some examples of high grid connection costs:
Region

Grid Connection Cost

Indonesia

Up to $30,000

Nigeria
Sri Lanka

$25,000 (plus purchase of transformer)

S

Up to $35,000

Source: GSMA Member Operators

Lead times for grid extension can materially affect network planning. Examples of grid connection lead times:
Region

Grid Connection Lead Times

Bangladesh

Up to 2 years

Namibia

6-12 months

Source: GSMA Member Operators

The GSMA Development Fund

Green Power for Mobile: Top Ten Findings

Grid reliability is a concern in rural regions of developing countries. In many countries, grid reliability in urban
areas is problematic as well. The following are examples of rural grid reliability issues:
Region

Grid Uptime in Rural Locations

Bangladesh

Urban: 4x 1hr outages / day

Rural: 2x 4hr outages / day

East Africa

Power outages 1 day / week

4 hour rolling outages

India

14 hours outage / day

Nigeria

Available 15-25% of the time

Pakistan

3,000 6,000MW capacity shortage

Sri Lanka

Daily unpredictable outages

Sumatra

4 hours outage / day

Source: GSMA Member Operators

Off-grid and unreliable grid sites have rapidly increasing costs

Both existing and new off-grid sites, and sites in regions of unreliable grid power have experienced substantially
increased costs during the last two years. The average price of diesel has risen more than 50% in many locations
within the past year, and contributes to a significant portion of operating costs for operators. The sustained rise of
global energy prices is a direct contributor to these costs.
Historical Retail Diesel and Crude Prices
UK Diesel

10
8
6

US Diesel

$/US Gal
4

Brent Crude

2
0
2003

2004

2005

2006

2007

2008

Source: EIA

Additionally, the cost of distribution is a significant contributor to operational costs of using diesel generators.
This cost is amplified in regions with sparse, rural networks or in regions with poor transportation infrastructure.
Build Up of Delivered Diesel Price
5

Estimate

Delivery
Retail

3
$/1
2
1
0

Minimum

Sri Lanka

Source: GSMA Member Operators

India

Phil'pns

Vanuatu

Nigeria

Maximum

The GSMA Development Fund

Green Power for Mobile: Top Ten Findings

The reliability of diesel distribution is an incremental constraint to the cost of distribution. Several operators (e.g.
Nigeria, Tanzania) have cited routine losses of 10% of total diesel supplies to theft or adulteration and even higher
percentages in certain regions. Fuel loss further amplifies high commercial fuel costs.

Solar and wind power are viable today and other solutions may
become suitable in the future

There are three primary factors that determine technical and financial viability of green power deployments for
mobile network sites:

The regional cost of distributed diesel For example green power is not attractive in Venezuela where the cost
of diesel is $0.02/L, however is compelling in regions where the cost is higher (in excess of $2.00/L in some
African countries).

Solar and wind conditions at the site - Insolation (strength of solar radiation) as well as wind strength vary
widely around the world. Site selections must consider the availability and consistency of green power sources.

Load requirement of the site - The financial and technical viability of green power degrades at higher load
requirements.
Better
Criteria

Solar

Worse
Wind

Pico-hydro

Biodiesel

Fuel Cells

Fossil Diesel

Overall Ranking

Key
**

CAPEX

***

Very Good

OPEX

Good

Reliability

Okay

Supplier Availability

Very Poor

Theft Resistance
Public Green Image
Operational Supply Chain Predictability
Output Predictability*
Resource Availability
Source: GSMA Analysis

Poor

*Assuming fuel is constant **Assuming purchase of biofuel from supplier ***Fuel cell CAPEX forecast to improve rapidly

Solar and wind technologies (including solar and wind hybrids) are currently the most attractive technologies for
powering base station sites.

Due to the abundance of solar resource, commoditisation of solar modules, ease of planning and low running
costs, solar is a favoured choice for green power solutions in many regions for small load sites (<2kW). However,
CAPEX scales proportionately with load and solar solutions are less economically attractive for larger sites. Costs
of solar solutions are projected to decrease further as market entry by silicon (primary raw material for solar
modules) suppliers is projected to substantially increase silicon supplies within the next 2 years.

The GSMA Development Fund

Green Power for Mobile: Top Ten Findings

Trend in Global Solar Module Prices

8
7
Installed cost

6
$/Watt 5
4

Module

3
2
2004

2005

2006

2007

2008

2009

2010

Source: BizEsp

At standard base station loads, the installed cost of energy from wind is cheaper than for an equivalent solar
system due to a lower basic equipment cost. The cost of small scale wind solutions is approximately $0.10-$0.11
per kWh, and projected by suppliers to reach $0.07 within 5 years (American Wind Energy Association Small
Wind Turbine Global Market Study 2007). However, due to variability in wind speeds across the globe, wind-only
solutions are likely to be restricted to locations with abundant wind resource such as coastal and mountainous
regions.

Hybrid solutions deliver the benefits of both wind and solar technologies and will be more common than windonly solutions.
Other niche technologies will continue to develop including:
Pico-hydro

Pico-hydro refers to very small hydro power solutions, typically less than 10kW that can harness the power of
streams and rivers. It is a mature technology for other applications such as rural electrification and has the lowest
CAPEX of all solutions. The limited number of appropriate locations will limit mass deployment.
Biofuels

The application of biofuel to telecommunications must be treated as a case-by-case prospect rather than a universal
alternative. The primary consideration will be local access to a regional supply of biofuel. The impact of biodiesel
production upon regional agriculture should also be evaluated. Biofuel application has increased appeal in regions
not competitive with food supplies (semi-arid crops such as jatropha).
Fuel cells

Fuel cells provide an alternate battery solution to sites in unreliable grid power locations. They are primarily
considered for limited power load requirements as a backup power source. Fuel cells are a developing technology
with currently limited proven commercial application to base station sites. However there is substantial investment
in this space by several development organisations. Suppliers have forecast a cost reduction of 30% by 2010.

The GSMA Development Fund

Green Power for Mobile: Top Ten Findings

Capital expenditure is high for green power but at low loads the payback period is short

Mobile networks in regions without access or unreliable access to conventional grid power typically rely on diesel
generators as either a primary power source or backup power source. Diesel generators offer a lower and
standardised initial capital cost. However fuel, maintenance and replacement costs are high and extremely
vulnerable to market conditions.

In regions with unreliable grid, green power solutions primarily benefit operators by providing coverage during
grid outage. Secondarily, use of grid power is offset by green power, reducing operational costs.

In off-grid regions green power solutions can replace the reliance on diesel generators, eliminating capital
(generator) and operational (fuel) costs in some cases. Higher power load sites can be supplemented by green
power solutions, reducing the operational (fuel) costs.

The deployment of green power, provides on average (solutions are extremely scenario-sensitive), compelling
returns on investment, particularly at lower loads.

Load Effect on IRR by Technology

50%
As wind-turbine equipment is bought in discrete lumps
e.g. a 6kW Turbine; the IRR curve is not smooth for
wind-only or hybrid systems

40%
30%
IRR
20%

12.7% Wind-Only
12.3% Hybrid

10%
0%

0% Solar-Only
800

900 1,000 1,100 1,200 1,300 1,400 1,500 1,600 1,700 1,800 1,900

Source: GSMA Analysis and Evaluation Tool

BTS Load (W)

Although there is broad acknowledgement that green power sites may be operationally cheaper than diesel
generator powered sites, operators work within allocated funding for network expansion and are motivated by
market competition to choose greater expansion (to benefit from early mover advantage) rather than optimised
expansion. Operators manage the business by configuring networks for optimal coverage and immediate
U
commercial returns. Power requirements are often a secondary consideration and are not a prevalent factor in
determining site locations for mobile network sites. In a scenario with a cost of green power approximately 50%
greater than conventional power and an operator allocation of funds for 600 new sites, only 400 green sites could
be deployed with the same amount of funds.
Operators facing capital limitations may increase investment in green power solutions if capital financing options
were available. Green Power for Mobile is working with financial institutions to advance potential financial
vehicles to support green power deployment in mobile networks.
0

The GSMA Development Fund

Green Power for Mobile: Top Ten Findings

Power provision is a non-core activity for operators that presents

an additional challenge

Powering base stations is a cost of doing business for operators and is not intuitively a part of network design.
As networks have expanded into regions without direct or reliable access to grid power, operators have been
forced to become increasingly involved in the business of powering network sites. Contracts are established and
maintained with power equipment suppliers (typically generators), fuel suppliers and distributors, and equipment
service and maintenance providers. The resultant cost of development of establishing a capability to manage
energy portfolios is a deviation away from the core business.

Utilising green power solutions adds a new layer of complexity to an operators management of their energy
portfolio. Operators are investing to various degrees in building internal expertise in green power solutions. Some
are buying directly from green power suppliers and specifying, installing and operating the solutions in house,
whilst others are seeking an outsourced turnkey solution.

Green power feasibility assessments are complex and scenario-based

Assessment of green power for specific base station sites is based upon a number of meteorological and
geographical factors. Meteorological conditions and seasonality strongly influence the optimal configuration, and
anticipated performance of a green solution. In combination with this localised topography and vegetation would
impact the selected configuration.
For a solar, wind or hybrid solution, data on insolation and wind strength is used in conjunction with diesel cost
information to assess the selected region for viability of a green power solution.
Wind Resources

Solar Resources

Source: NREL

Source: NREL

Diesel Price+

$/litre
0.02

2.45

Note:

*Some estimates have been made

+Forecasts have been made from 2006 prices
Source: GTZ

Although assessment is complex, knowledge within the industry is evolving rapidly and Green Power for Mobile
aims to consolidate these learnings. If green power is an option for powering all or part of a greenfield rollout it
is strongly recommended that the operators power expert is engaged early within the network planning process,
to ensure the complexities above are understood and incorporated.

The GSMA Development Fund

Green Power for Mobile: Top Ten Findings

Energy optimisation has become a focus of mobile network technology development

Telecommunications equipment vendors are making considerable investments in the development of lower power
equipment, providing operators with the ability to reduce the cost profile of new sites and retrofitted existing sites.

Battery technology has evolved and is capable of substantially reducing reliance on diesel runtime. In some cases,
unreliable grid access can be addressed by adequate battery backup for brownouts or blackouts.

Recent advances in telecommunications equipment such as remote radio heads (reduced feeder cable losses) and
improved tolerance of equipment to ambient temperature from 25C to 45C may permit the reduction or in some
cases complete removal of air conditioning from sites. This can result in substantial energy savings for operators.
Operators can at a minimum achieve efficiency gains, and potentially reduce loads to levels commensurate with
green power solutions.
The power load for a typical base station varies widely on the type of site. Additionally there are several main
contributors to power load. One substantial non-core requirement is cooling.

Overall Site Power Consumption

Lighting
Varies between 50W-200W depending on need for
security and safety e.g. aircraft warning lights

Monitor
If done, rarely more than 100W

Backhaul
Varies depending on location <50W for fibre-optic connected,
up to approx 500W for long range multi-point microwave
Commonly approx 100-200W

BTS
Varies depending on functionality of equipment
Currently deployed in range of 1-2kW
Most energy efficient, new equipment 0.6-1.0kW

Cooling
Varies depending on designed specification and (less so) climate
Range from 2kW-4kW for full air-conditioning
New sites often avoid cooling or use forced ventilation,
heat-exchangers etc - ~200W

Source: GSMA Member Operators

Note: Figures vary considerably depending on site, climate, equipment etc.

Energy efficient base station sites are integral to the viability of green power solutions as the financial and technical
viability of green power degrades at higher load requirements.

8
1

Accurate specification is critical for green power sites

Operators typically require 100% uptime for sites. In unreliable grid regions, green solutions can provide coverage
capacity during grid outages. In off-grid locations, assessment and solution specification is crucial for maintaining
uptime.
Diesel generator solutions rely on only two factors:

Working condition of generator

Supply of diesel

Green power solutions introduce additional complexity that must be accounted for:

Variability in renewable resource availability, such as still and cloudy days

Battery capacity design to support site autonomy when no power is produced

Control of power flow, capacity, and AC/DC power conversions

The GSMA Development Fund

Green Power for Mobile: Top Ten Findings

Green power solutions rely substantially on power controllers to optimise and maintain performance. Intelligent
management is introduced through controllers to ensure optimum power management, control and protect the
batteries, and to ensure availability of critical components (e.g. backhaul).

To insure against inherent variability and uncertainty, operators may choose to rely on a diesel generator as a fallback power source for critical sites during rollout.

Due to the level of complexity in the process of specifying a site and selecting appropriate equipment, it is
suggested that operators seek guidance from vendors with experience in deploying green power solutions for
base station sites.

Nearly all operators in the developing world have green power initiatives

Of interviewed operators, 39% have trial sites, 50% have commercial green power deployments and nearly all
have plans for green power. Remaining operators have expressed interest in initiating activity.
Current Green Power Deployments in Developing Countries

Note:

Number represents number of deployments.

No number indicates single or unknown number of sites
Source: GSMA Memeber Operators

Operators are motivated by:

Mitigation of rapidly rising energy costs across networks.

Access to regions that lack an electricity grid and do not support regular distribution of diesel.

Many operators request project support in design and launch of trials and pilots. Additionally, most operators
have stated intentions to invest in the deployment of green power on networks.

Current and Planned Green Power BTS

South Asia
Trials/Current

East Asia and Pacific

1,500

Sub-Saharan Africa
Middle East and North Africa

Planned

10,000

2000

Source: GSMA Member Operators

4000

6000
# BTS

8000

10000

12000

The GSMA Development Fund

Green Power for Mobile: Top Ten Findings

Based on analysis of current market conditions, we project that a significant number of new and existing off-grid
base stations can be green power sites.
3 year Payback Period

5 year Payback Period

% off-grid BTS sites

viable for green power

9%

30%

# green sites by 2012

53,000

176,000

Reduction of diesel / yr

1.1bn litres

3.5bn litres

Fuel cost savings / yr

$1.3bn

$4.2bn

CO2 emission reduction / yr

2.8M tonnes

9.6M tonnes

Source: GSMA Analysis

An interpolated 20% penetration yields a target of 118,000 green power sites by 2012. Additionally, the GSMA
predicts that by 2012 up to 50% of new off-grid base stations in the developing world could be powered by
renewable energy.

Green Power for Mobile is uniquely positioned to provide guidance and support in this space through the delivery
of knowledge assets and methodologies, aggregation of relationships with suppliers, and community building
bridging operators, green power vendors and telecommunications equipment vendors.

10

Innovation will be driven by a cohesive industry community

The GSMA seeks to work with operators, green power vendors, and telecommunications equipment vendors to
impact a global reduction in industry-wide greenhouse gas emissions and increase the number of people connected
today. A cohesive community with regular events and leadership will facilitate the exchange of ideas and needs
to drive the use of green power solutions within the mobile industry forward.
Areas at each of GSMA Mobile Congress events will be dedicated to green power. These areas will provide a
recurring opportunity for operators and vendors to present notable milestones and emerging technologies

The Green Power for Mobile Working Group

The objective of the Green Power for Mobile Operator Working Group is to consolidate industry insight and
experience of green power to catalyse deployment across the industry. The Working Group consists of more than
30 operators that have indicated a commitment to Green Power for Mobile and have allocated delegates for
quarterly meetings. The Working Group will provide a forum to highlight operator initiatives, address industry
challenges related to Green Power for Mobile, and collectively assess available products and solutions.
Carbon Credit Trading

Additionally, the GSMA is also evaluating the potential for the industry as an aggregate to benefit from carbon
credit trading. At a site level, carbon credits produced by replacing an off-grid diesel generator site with green
power range from US$450-$1,500 per site, per year. Although this amount is too small to warrant the overhead of
carbon trading at a site level, the economics of aggregating network credits are immense. The programme has
evaluated suitable carbon trading methodologies to support trading through the UN Framework Convention on
Climate Change (UNFCCC) and plans to move to a pilot phase are underway. Under consideration are options as
granular as at an operator level up to aggregation at an industry level.

The GSMA Development Fund

Green Power for Mobile: Top Ten Findings

Conclusion

Operators all pass through a similar set of decision points in defining power portfolios and the applicability of
green power solutions to their networks.

Green Power for Mobile targets the provision of these assets using a set of customised, scenario specific analytical
tools to improve the quality of decisions and suitability of green power deployments. The programme provides a
decision tree tool and financial viability forecasts to assist operators in raising the right questions to improve
predictability and success of power decisions. While not all scenarios are suitable for green power, operators will
be equipped to define network power portfolios appropriately and be better positioned to identify and act on
opportunities to deploy green power reliably and productively. Operators will be able to realise tangible added
economic, environmental and social benefits within mobile networks.

For further information please contact

greenpower@gsm.org
GSMA London Office
1st Floor, Mid City Place, 71 High Holborn, London WC1V 6EA, United Kingdom
T +44 (0) 20 7759 2300
www.gsmworld.com/greenpower